Here Comes China

I have had a few questions about China and have been slow to do the usual combination of my own geopolitical commentary and Godfree Robert’s newsletter extracts.  This time I want to dedicate the Here Comes China essay to two people.  This will both answer the questions as well as highlight superb work that has been consistent throughout the years.

A short piece from Dongsheng News

Xi Jinping is reelected as General Secretary by the 20th National Congress of the CPC. The new Central Committee of 205 members has an average age of 57.2 years. The Party constitution is amended to incorporate core position of Xi and his thought as well as common prosperity and socialism with Chinese characteristics for a new era. Emphasizing the importance of national reunification, the CPC opposes “Taiwan independence”. Congress report criticizes Western modernization, based on wars, plundering, and colonization.  China’s modernization must be based on a peaceful, socialist, and people-centered development. China believes that its model can be an alternative to capitalism, but should never be imposed.

If you take a look at the bolded words please note the word NEW.  In much of the Chinese news and commentary on the National Congress, we see that it is considered a new era, a new path forward, but based on old historical values.  So, this is clearly meant to be a new era for China, where they will be rolling out new methodology, and if anyone else is interested, they may take lessons or ask questions from China.  But for the first time, we have an alternative to capitalism that has not already been beaten to death with words that people are scared of like socialism or communism.  In any event, when most westerners use the word communism they actually refer to Bolschevikism.  People sometimes take concepts, put their own value to it, and consider this the truth.  Well, we are not seeking truth here, we are seeking an accurate depiction of what the world around us is moving to, how it is doing that, and how will that affect us.  Realpolitic in other words.  The Chinese people are not too worried about the depiction of a ‘new’ conceptual framework.  The Monday after the final election of the National Congress, the Chinese markets fell, and everyone in the west reported this of course.  But if one looked at it carefully, it was sectors of the market that fell, and those sectors were in any event western money.  The stability of China per se was not shaken.  The sectors that shook off the election, were the Chinese sectors .. they felt no pain. China’s domestic defense industry jumped over 3%, with AVIC Heavy Machinery – a military-linked aviation firm heavily sanctioned by the US – rising by the 10% daily limit. The STAR Market – the Nasdaq-like, new economy-focused board inaugurated personally by Xi Jinping in 2019 – ended the day in positive territory. Sectors that have been the target of regulatory crackdowns – like big tech and private ed – are expected to continue to struggle.

Those market segments where we saw regulatory crackdowns are segments and sectors that touch the inherent value system of China.  For example, private education clearly put Chinese students under stress, more than what is fair and good to maintain the high educational standards in China and in effect weakened the standards by placing education not in the hands of educational authorities, but in the hands of for-profit companies.  We see clearly what such a system did under a capitalist system if we take a look at western educational standards.  The Chinese authorities are not afraid to let parents know that they are stressing their kids, or putting the wrong educational standards into place.   It is during this process that computer games for younger kids were capped at 3 hours per week because the educational striving became too intense, and many Chinese kids started suffering from nearsightedness because they did not get sufficient outside play and distance viewing.

The Chinese are going to invest in the Chinese first, and then their investment will be in infrastructure.   I expect to see a system of ‘friendly countries’ such as what Russia is doing, but I don’t think we will see that spelt out as Russia is doing.

This brings us to Chinese values and ideology.  It is of course almost unbelievable for a westerner to understand that in general, the Chinese rank and file trust their governance.  And if something is wrong, there are almost 4,000 street actions in China per month.  People are not quiet and submissive in the sense of that they have to be.  They speak, but they speak with respect.

I take a look at a US alternative and so-called free speech site now and again – only the headlines really because it becomes truly boring – This morning the alternative so-called free speech headlines are raining hellfire and brimstone on Lula and they are convinced that the elections were stolen (Just like with Trump they say).  These people are not even educated I’m sorry.  They have no values although they profess they have.

So, in terms of the values in China, for a westerner I must recommend Godfree Roberts’ book, Why China Leads the World.  Godfree has a doctorate in, and has lectured in Experimental Education for most of his life.  So, the way that he designed his book, is experimental but it works beautifully.  He starts with historical values, or Chinese historical ideology, and then he brings through each of the aspects that he deals with, to modernity, while keeping the historical platform intact.  He manages to do all of this in a style which remains easy to read, without being teacherish or pedantic.

This book is now probably very reasonable to buy, and I recommend it highly.

While we’re looking at China, let’s take a look at Godfree’s last newsletter.  He prepared statistics such as these:

I usually select carefully from the Here Comes China newsletter but this time I’m just going to bombard you with just the first section which is Economy.  Then there is Trade, Health, Society, Technology, Governance, Statistics, History, Geopolitics, and Long Reads :

• The yuan now accounts for half of China’s domestic and foreign currency cross-border settlements, and foreign governments and businesses increasingly consider it an alternative to the US dollar. Cross-border yuan settlements surged 29% to $5.1 trillion last year and rose 15.7% in H1 this year. Read full article →
• GDP grew 3.9% in Q3 YoY, up from 0.4% in Q2. Retail sales rose 2.5% in September, while industrial production rose by 6.3%. Read full article → 
• New Premier Li Qiang holds a British PhD in engineering, was Jack Ma’s biggest supporter and brought Tesla to Shanghai. Li was chosen for his track record of economic and financial innovation in the Shanghai Free Trade Zone, for bringing in major foreign investment (up 32% last year) and for the policy papers on economic development he wrote for Xi as an assistant in Zhejiang. Read full article →
• Eurozone manufacturers’ factory output saw fifth consecutive decline in October as backlogs fell for a fourth month. Services companies said their decline in new orders accelerated for a third month. German GDP  is expected to shrink in the third quarter, when figures for the period are released on Friday. Read full article →
• China’s growing maritime power has far-reaching implications for the US. With 90% of global trade traveling by sea, the US has both commercial and strategic interests in maintaining robust maritime capabilities. Current and former U.S. officials have warned that the US could face maritime logistics challenges during a major conflict given the shrinking size of the U.S. merchant marine fleet. Read full article →
• Beijing lowers EV prices by phasing out subsidies for high-priced EVs, so Tesla’s Model 3 RWD now costs $36,663 (vs. $48,000 in California), and the Model Y RWD is now $40,000 with subsidies ($60,000 in California). A recent buyer: “I lost 30,000 yuan in three months due to repeated price drops.” Read full article →
• Macau casinos stocks snapped run of losses when the city announced it will permit group tours from China to resume. Read full article →
• Rice quality has been reduced by this year’s drought conditions in south China. People delivering rice to granaries must now fill out a form with their name, ID, contact info, date of delivery, rice weight, truck registration, cadmium content, warehouse number, and village, town and county where the rice was grown, as part of a new traceability system. Read full article → 

IMF Growth Forecast for 2023
Brazil🇧🇷: 1%
Canada🇨🇦: 1.5%
China🇨🇳: 4.4%
France🇫🇷: 0.7%
Germany🇩🇪: -0.3%
India🇮🇳: 6.1%
Italy🇮🇹: -0.2%
Japan🇯🇵: 1.6%
Mexico🇲🇽: 1.2%
Nigeria🇳🇬: 3%
RSA🇿🇦: 1.1%
Russia🇷🇺: -2.3%
Saudi Arabia🇸🇦: 3.7%
Spain🇪🇸: 1.2%
UK🇬🇧: 0.3%
USA🇺🇸: 1% Read full article → 

This newsletter saves me many hours of research per week.

I always say one cannot talk about China and her development, without talking about space.  China successfully launched the Mengtian lab module – the third and final part of its three-module home-developed space station – into preset orbit, on Monday afternoon from South China’s tropical island province of Hainan, kick starting the final battle of completing the country’s T-shape and first-ever permanent space station.  https://www.globaltimes.cn/page/202210/1278360.shtml

This is a completely modular space station design, and what this means is that your country or mine can build our module, launch it and hook it up. This is what the project looks like currently. https://www.chinadaily.com.cn/a/201906/13/WS5d0106d9a310176577230d2c.html

China Manned Space Agency and UNOOSA signed a memorandum of understanding in 2016. The initiative aims to develop the space capabilities of UN members by providing opportunities to fly onboard China Space Station, which is expected to orbit the Earth in 2022.

The two sent out the invitation to all UN members in May 2018 and have received 42 projects from 27 developed and developing countries, covering a wide range of studies in different technical levels.

The evaluation panel, consisting of experts and academicians from a number of universities and research institutions, with 20 percent from overseas, jointly reviewed all the project proposals and selected the final nine, according to Lin.

“China Space Station belongs not only to China but to the whole world as well. The completion of the station will offer better ‘Chinese solutions’ and make China contribute more to the economic and social development of mankind,” he said.

OK, and let’s really sex this up.  Check out this helicopter:  China’s domestically developed Z-20 utility helicopter has surpassed the US’ Black Hawk, as it has adopted many advanced technologies the Black Hawk does not have, said the chief designer of the Chinese chopper on state broadcaster China Central Television (CCTV).

So, can we truly criticize the Chinese values and the ideology to build something that may be valuable for mankind as a whole?  Can we even categorize this as a value?  I think we clearly can.   Can we even say if this is a good thing or a bad thing?  In my view, following China now for many years, their good things are plenty more than their bad things.  Godfree kept statistics on Covid during the period, but at The Saker I never used that material.  This will change in the next few hours.

This brings me to the 2nd person that I wanted to highlight.  From Jeff J Brown and China Rising Radio Sinoland we recently received this astonishing library:

https://www.bannedthought.net/China/Individuals/index.htm

Jeff is very active and as you can see from that library link, we get frequent golden contributions from him.  He can be followed through his telegram link.  I check him out daily and if I have a Huawei question, Jeff is the go-to person.  His set of books is still evergreen!

These are probably in terms of older westerners, the two best sources on China.  There are a whole bunch more, but specialized, and from both Godfree and Jeff, I enjoy the generalist approach.

Thank you guys, for what you do!

Let’s end with comedy!

Amarynth